Business is booming at North Korea’s ‘Singapore shops’ despite UN sanctions banning them

Despite the unwanted publicity of a criminal trial for one of their main suppliers, business is booming at Pyongyang's 'Singapore shops,' which sell everything from Ukrainian vodka to brand-name knock-offs from China.

The stores stock many of the very things United Nations' sanctions banning trade in luxury goods are intended to block and provide a nagging reminder that not all potential trade partners are lining up behind the UN's pronouncements or the Trump administration's policy of maximum pressure on the North.

And while being the focus of the court case that could land OCN's former director in prison for a very long time, they continue to unabashedly specialise in imported products — perfumes, fine jewellery, wines, clothing and cosmetics — that would appear to blatantly violate UN restrictions.

Formally known as the Potonggang Ryugyong Shop and the Bugsae Shop, the stores are a fixture of the upscale shopping scene in Pyongyang, catering to the capital's elites, Chinese businessmen and members of the diplomatic corps.

Purchases can be made in dollars, euros and Chinese yuan. The price in each is displayed digitally on the cash register.

They are well marked, open to walk-ins and distribute their own membership cards to reward regular customers. (AAP)

Both stores have been substantially renovated since last summer.

The Ryugyong store now has a coffee shop behind the imported shoe section on its second floor. The Bugsae shop has installed dark wood panelling and glass casing for its wines and spirits corner, which was recently dominated by vodkas from the Ukraine.

It has separate display areas for snacks and soft drinks from Japan, Malaysia and China, a row dedicated to fancy shampoos, and a section in the rear for imported electronic appliances and household goods.

The well-stocked shelves belie the hit supplies must have taken with the arrest of their former Singaporean trading partner.

Ng Kheng Wah, 56, faces 80 charges of violating United Nations sanctions for allegedly supplying six million worth of luxury goods to the Bugsae Shop from 2010 to 2017.

This includes watches "clad with a precious metal," jewellery, musical instruments and wine.

While OCN is not mentioned, the charges accuse Ng of trying to defraud banks through another of his companies, T Specialist International.

Ng, who stepped down as an OCN director in March, also faces 81 charges for working with a partner identified as Wang Zhi Guo to deceive DBS, the Oversea-Chinese Banking Corp. Ltd and Malayan Banking Berhad to carry out his deals, issuing false invoices for the sale of Watari Instant Noodles to T Specialist, most amounting to hundreds of thousands of dollars.

Ng was charged on July 18 and granted bail of 500,000 Singapore dollars ($364,645).

A pretrial conference is scheduled for Jan 17.

For each offence under the UN sanctions act, Ng faces a maximum sentence of five years in jail and a 100,000 Singapore dollars ($AUD 103,683) fine.

Each cheating charge comes with an additional maximum jail term of 10 years and an unspecified fine.

Ng denied any wrongdoing in an interview with the Singaporean newspaper The Straits Times shortly after reports of possible violations became public.

He said OCN was the sole distributor of the popular Japanese Pokka brand canned drinks in North Korea from 2000 and 2012, but claimed OCN dropped that when Japan imposed sanctions banning such exports.

Documents presented in court show that in early 2014 his other business, T Specialist International, presented a bogus invoice to a bank from which it was seeking a loan, claiming it had received $522,410 ($AUD 783,963) for Pokka sales.

The case hints at an uncomfortable truth that has long hamstrung efforts to make sanctions enforcement really bite: engaging the North is not as uniformly taboo with potential trading partners as Washington might like.